Co-investment plan to pump $1.5b into local production

3 minute read

No more Gardasils, says the federal government. What’s developed here should be made here.

In the first major pre-Budget announcement for health, the federal government has released the Medical Science Co-investment Plan, worth $1.5 billion, designed to increase public investment in “high value” therapies. 

The Plan was released formally today by the Minister for Industry and Science Ed Husic and Minister for Health and Aged Care Mark Butler. 

“Too many great Australian ideas have left our shores only to return as an import from another country,” said Mr Husic in the government’s announcement. 

“Gardasil is a prime example of the terrible cost of lost opportunity, brilliant Australian medical research ended up being manufactured overseas because we didn’t have the capabilities to make it here.” 

The Plan outlines how government and industry could work together to “grow opportunities” in medical manufacturing. It identifies a broad range of high-value investment opportunities, including in medical devices, vaccines and personal protective equipment. 

“We will capture more value from Australia’s world-leading medical science sector by increasing industrial capability and capacity, supporting commercialisation, and improving our international competitiveness,” said the Plan’s summary

What the Plan rules out, according the Sydney Morning Herald, is pouring large amounts of cash into large-scale facilities producing common medicines, “because Australia will struggle to match the lower transport and labour costs in other countries”. 

The federal plan assumes that $1.5 billion from the National Reconstruction Fund will be put towards making medicine and medical devices in Australia, decisions that will be made by the NRF board, and not the ministers. 

“As the NRF looks to revitalise manufacturing capability in key priority areas, we need a clear picture of the challenges and opportunities we face in each sector,” said Mr Husic. 

Mr Butler said Australia had some of the best medical researchers in the world. 

“We need to be utilising their talent and growing a medical manufacturing industry that will be world leading,” he said. 

“This is all part of the Albanese Government working to deliver a future made in Australia.” 

AusBiotech, Australia’s peak body for the biotechnology industry welcomed the Plan as “it identifies four key investment opportunity areas in the medical science priority area: medical devices, complex therapeutics, digital health, and sustainability”. 

“The Co-Investment Plan outlines the unique environment that companies developing life-enhancing and life-saving technologies operate in and is a strong indicator to investors of the areas of opportunity where Australia can diversify and grow its manufacturing capabilities,” said Dr James Campbell, interim chair of AusBiotech, which was part of the medical science industry working group for the plan. 

“Australia’s biotechnology industry has grown 40% in the past two years, reinforcing the knowledge-based sector’s economic and social value and potential to Australia and Australians.  

“In order for small and medium-sized companies to scale up and scale out, attraction of risk-tolerant patient capital across the pipeline remains critical.” 

Health and medical research in Australia is an outperforming sector – ranked seventh in the world, with an ecosystem of more than 1200 biotech companies, 55 medical research institutes and 40 medical research-focused universities.  

But, according to the Department of Industry and Science, medical manufacturing only accounts for 0.3% of GDP. 

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